Start using debit cards, says Urjit Patel

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Supporting government’s ambition to make India a cashless economy, RBI Governor Urjit Patel on Sunday urged the people to start using debit cards and digital wallets, saying it will make transactions cheaper and easier and in the long term, it will help India “leapfrog into a less cash-use economy at par with more developed nations.” “We are also urging banks to make a big push with PoS (Point of Sale) machines with traders so that debit card use becomes more prevalent,” he said.

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Debit card is a plastic card that allows the holder to transfer money electronically from their bank account when making a purchase or withdraw cash from ATM.

To lessen woes of people facing cash crunch, the RBI has already waived ATM charges on all transactions done by savings bank customers till December 30. The waiver is applicable on transactions done at ATMs from November 10 till December 30, 2016. There are about 2 lakh ATMs of different banks across the country. A customer was permitted at least five free transactions per month for use of own bank ATMs. Banks could charge up to Rs 20 (plus service tax, if any) beyond the permitted transactions.

Following cancellation of legal tender character of old Rs 500 and Rs 1000 currency notes from November 9, restrictions were imposed on cash withdrawals from accounts and ATMs. The central bank on November 13 raised the daily withdrawal limit from ATMs to Rs 2,500 from Rs 2,000 earlier. The weekly limit of Rs 20,000 for withdrawal from bank accounts was increased to Rs 24,000.